News Hits

        
Tweet

Email

Print
Share

Friday, February 16, 2018

News Hits

As the HQ2 announcement deadline nears, consider it a bullet Detroit dodged

Posted By Michael Jackman on Fri, Feb 16, 2018 at 2:30 PM

click to enlarge

Shutterstock/Lee DeVito

As the deadline for Amazon's HQ2 announcement draws near, it's worth taking a look at the minority view: avoiding Amazon's nod may have been a good thing for Detroit.

Related Amazon HQ2 not coming to Detroit; city doesn't make the company's top 20

Amazon HQ2 not coming to Detroit; city doesn't make the company's top 20

By Violet Ikonomova

News Hits

It's spelled out in an editorial by Dean Baker, a macroeconomist and co-director of the Center for Economic and Policy Research in Washington, D.C. In a piece titled "Jeff Bezos’ Quest to Find America’s Dumbest Mayor," Baker makes several very good points that were impossible to hear over the din of cheerleading most of metro Detroit's media adopted during the phase when our fair city was still in the running.

Related Survey says: Detroit is thirsty as hell for Amazon's second headquarters

Turn that smile upside down: That thirst is unbecoming.

Survey says: Detroit is thirsty as hell for Amazon's second headquarters

By Violet Ikonomova

News Hits

The piece read, in part:

Bezos’ “HQ2” contest is simply an extension of a game that corporations have been playing with state and local governments for the last four decades. Rather than making location decisions based on standard economic factors, like the availability of a skilled labor force, quality infrastructure, land prices and tax rates, they have persuaded governments to bid against each other with company-specific benefit packages ― usually a basket of tax concessions and sometimes even including commitments to build company-specific infrastructure like port facilities or roads.

However, most research indicates that the cost to state and local governments for these subsidies typically outweighs the benefits in terms of employment and tax revenue, including in the cases of Amazon’s growing network of fulfillment centers.

A new analysis by the Economic Policy Institute looking at employment in counties that managed to land a fulfillment center in the last 15 years found no evidence that overall employment increased, and in some instances employment even fell relative to comparison counties. The implication was that the commitments made to win Amazon’s facilities ― subsidies likely worth over $1 billion dollars in total ― usually were enough of a drag on the rest of the economy, either by imposing a higher tax burden or diverting resources, to more than offset any jobs and spending created by Amazon.

In fact, the guru on cool cities, Richard Florida, had proposed that city leaders essentially boycott Bezos' contest, writing, "The time has come for elected officials, economic developers, and community leaders to take a principled stand against such a flagrant misuse of taxpayer dollars."

Tags: Amazon HQ2, Dan Gilbert, Jeff Bezos, Detroit development, Image

We welcome readers to submit letters regarding articles and content in Detroit Metro Times. Letters should be a minimum of 150 words, refer to content that has appeared on Detroit Metro Times, and must include the writer's full name, address, and phone number for verification purposes. No attachments will be considered. Writers of letters selected for publication will be notified via email. Letters may be edited and shortened for space.

Email us at letters@metrotimes.com.

Detroit Metro Times works for you, and your support is essential.

Our small but mighty local team works tirelessly to bring you high-quality, uncensored news and cultural coverage of Detroit and beyond.

Unlike many newspapers, ours is free – and we'd like to keep it that way, because we believe, now more than ever, everyone deserves access to accurate, independent coverage of their community.

Whether it's a one-time acknowledgement of this article or an ongoing pledge, your support helps keep Detroit's true free press free.